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Overbought Hang Seng Nonetheless Called Higher

The Hong Kong stock market bounced higher again on Friday, one session after ending the six-day winning streak in which it had spiked more than 1,340 points or 5.3 percent. The Hang Seng Index now rests just beneath the 27,880-point plateau and it has a positive lead for the open of trade on Monday.

The global forecast for the Asian markets suggests a higher open on hopes for additional stimulus and surging oil prices. The European and U.S. markets were up on Friday and the Asian bourses are tipped to at least open in similar fashion, although profit taking may set in later.

The Hang Seng finished sharply higher on Friday following gains from the financial shares and technology stocks, while the properties and oil and insurance companies were mixed.

For the day, the index advanced 329.70 points or 1.20 percent to finish at 27,878.22 after trading between 27,538.20 and 27,920.77.

Among the actives, Techtronic Industries skyrocketed 4.80 percent, while Meituan surged 3.25 percent, BOC Hong Kong soared 2.42 percent, AAC Technologies spiked 2.34 percent, Galaxy Entertainment accelerated 1.97 percent, AIA Group rallied 1.90 percent, CNOOC and Sands China both plummeted 1.79 percent, CSPC Pharmaceutical jumped 1.49 percent, Alibaba climbed 1.45 percent, CITIC gathered 1.23 percent, China Petroleum and Chemical (Sinopec) perked 1.08 percent, Industrial and Commercial Bank of China collected 1.02 percent, Ping An Insurance advanced 0.90 percent, China life Insurance sank 0.70 percent, China Mengniu Dairy dropped 0.39 percent, ANTA Sports added 0.38 percent, Power Assets fell 0.36 percent, Hengan International and Hong Kong & China Gas both gained 0.35 percent, China Resources Land rose 0.33 percent, Xiaomi Corporation eased 0.16 percent, New World Development increased 0.14 percent and WuXi Biologics was up 0.05 percent.

The lead from Wall Street is upbeat as stocks fluctuated on Friday but managed to finish firmly in the green, sending the major averages to fresh record closing highs.

The Dow rose 56.84 points or 0.18 percent to finish at 31,097.97, while the NASDAQ jumped 134.50 points or 1.03 percent to end at 13,201.98 and the S&P 500 gained 20.89 percent or 0.55 percent to close at 3,824.68. For the week, the Dow rose 1.8 percent, the NASDAQ gained 2.4 percent and the S&P added 1.6 percent.

The markets benefited from optimism that a Democrat-controlled government will lead to more fiscal stimulus and a better handling of the coronavirus vaccine rollout.

Traders were also reacting to a closely watched Labor Department report showing an unexpected decrease in U.S. employment in December - which may provide more ammunition for Democrats to pursue additional stimulus.

Crude oil prices rose sharply on Friday, as recent data showing a drop in U.S. crude stockpiles, and Saudi Arabia's decision to cut output continued to support the commodity. West Texas Intermediate Crude oil futures for February ended up by $1.41 or 2.8 percent at $52.24 a barrel.

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